Use Government Subsidies for Slow, Expensive, Not-Symmetrical, Not-Fiber, Wireless Services and Block Overbuilding by Competitors
SEE Part 1: They are Howling in the Peanut Gallery: This AT&T policy blog had 73 comments listed. We put up the first 9 commentators about AT&T’s policies. It is not a pretty sight.
PART 2: Questions about AT&T and Government Subsidies.
On an AT&T policy forum, an Executive Vice President of Federal Regulatory Relations, on March 26th, 2021, posted their opinion about offering Universal Broadband, especially with government subsidies.
Part 1 supplies the first 9 public comments about the plan; (there were 73 on the AT&T site). Since this was written, in March 2021, a whopping $65 billion is now being given out to solve the Digital Divide.
As we will discuss, AT&T’s plan is to offer slow, expensive, asymmetrical (thus faster only as a download) wireless service, but not fiber to the home and all with government subsidies. Before we walk through AT&T’s agenda, a bit of history is in order about AT&T and the previous plans for broadband, most of which have faded into memory.
The Unknown History of AT&T’s Failed Broadband Deployments
AT&T’s Public Policy Plan, when laid out, is a sad state of affairs. AT&T is in actuality, a holding company that has been built through monopolistic mergers and it now controls 21 state public telecommunications utilities, such as AT&T California. Of course, AT&T never mentions that there are still state telecom utilities in existence, much less that it represents their core territories. But the real shame is that AT&T and its progeny, has mainly let this critical state-based telecom infrastructure deteriorate, not replacing the aging copper wires with fiber optic wires, which was supposed to happen in these states, starting in the 1990’s. Worse, by 2007 there were supposed to be no AT&T ‘unserved’ areas, based on the merger condition with BellSouth that required 100% covered in these 21 states.
In just California, AT&T California was supposed to have 5.5 million households upgraded with fiber by the year 2000 and spend $16 billion, starting in 1995. And this is just California, not the other 20 states that include Texas, Illinois, Kentucky, Kansas, Arkansas, Louisiana, Wisconsin, Alabama, Mississippi and Oklahoma, among others. And each of these states had broadband plans over the last 3 decades. Ever hear of TeleKansas or TeleFuture2000 in Missouri? (I note that former FCC chairman Ajit Pai, from Kansas, never mentioned that the incumbent, Southwestern Bell (one of the Bell companies that controlled Kansas, Texas and Missouri), never showed up to do the fiber optic networks it had claimed was coming, even after state laws were changed to give the company money for the build outs.)
In fact, in the AT&T controlled states there were multiple waves of ‘promise them anything’ deployments such as U-verse, the next wave of ‘broadband’. It was supposed to be fiber optics but was really re-purposing the existing copper wires. AT&T never made this point explicit to the public, press, politicians or regulators, like the FCC.
From ‘Gigapower’, the next wave of fiber optic deployments, to the new and current 5G bait-and-switch, where the companies are attempting to claim that it is a substitute for any fiber upgrade, in the end the math is simple:
AT&T still controls 21 state public telecommunications utilities which covers approximately 76 million locations. Yet, at the beginning of 2022, AT&T has less than 6 million fiber optic lines to residential and business customers, (and we assume that they are almost all located within the 21 state service areas).
Ironically, and as we have pointed out, AT&T is actually using the old names of the long dead companies to get government Emergency Broadband Benefit money, where AT&T is getting its retail rates subsidized for broadband access for low income customers, even the made up fees.
What Has AT&T Said about Government Subsidies?
“As we turn the corner on the pandemic, and drive toward economic recovery, delivering broadband connectivity to every home and every farm, in every city and town, large and small, has become a national priority. Billions of dollars have already been directed to broadband infrastructure and affordability in stimulus legislation, and we anticipate a significant commitment to broadband deployment in the upcoming Biden infrastructure bill.”
What AT&T wants is to seriously lower expectations and only offer slow, asymmetrical service, and it will be wireless. AT&T wants to keep the prices expensive, and not allow others to offer symmetrical services that is the same speed down and up. AT&T does not want to allow competitors to ‘overbuild’ in their territory and surely does not want to provide competitors with Open Access to their networks.
- Definition: “Overbuilder” Really Means: We didn’t upgrade our telecom utility networks over the last 3 decades and no one else should be allowed to come in and offer competitive services.)
AT&T wants the government subsidized networks to only be fast in one direction, “asymmetrical’, and there should be no mandate for ‘symmetrical’ speeds.
How to Understand Broadband Speeds and Capacity
Broadband is defined by the speeds and capacity measured in “Mbps” or “Gbps”, (which is 1000 Mbps or so). So, if you are watching a video, your download speed matters. But if you’re on a Zoom call, you are making the connection, sending your video picture, and this is ‘uploading’. If both speeds are the same — 100Mbps up, 100Mpbs down, your video won’t slow down or degrade. But the FCC’s standard of 25Mbps down and 3Mbps up, has issues as the speed and capacity varies greatly and the interfacing with the equipment and set up the person/family is using also is an issue.
The problem is that Zoom, which during the Pandemic for online school, work and tele-visits, recommends 3–4Mbps upload capability for HD quality in 2021, per network connection. — however, Metaverse, virtual reality requirements and other next gen gaming, or serious video teleconferencing — all will have heavy ‘upload’ requirements.
In contrast, AT&T announced fiber optic based services of 2–5Gbps. Thus, AT&T is condemning rural areas with service speeds that are already obsolete and has been subsidized by the government.
In the end of the day, a copper wire has more speed and capacity limitations, as compared to a fiber optic wire, and had AT&T simply did what they said they would do — replace the copper wire with fiber, starting in the 1990’s, none of this would have happened in these states. And yet, instead of getting the story straight, the politicians want to give AT&T, the company that failed the majority of America, more money.
Why would AT&T complain about providing symmetrical connectivity speeds, and also only wants slow speeds?
- Wireless services are not symmetrical.
AT&T never mentioned this shocking fact:
“But wireless networks are not built to deliver symmetrical speeds, so any mandate around symmetrical performance could undermine delivery of these efficient and robust technology solutions in hard to serve areas of the country.”
- The wireless ‘symmetrical build’ would be done as an ‘overbuild’, i.e., an additional service in an area already served by an incumbent broadband service — and this will harm the previous investments.
“Adopting a symmetrical standard could result in overbuilding existing services today, including existing asymmetrical services that are currently meeting modern connectivity needs…..Overbuilding such solutions would needlessly devalue private investment and waste broadband-directed dollars.”
AT&T’s investment is NOT private as most of it comes directly from diverting the construction budgets from the state PUBLIC utilities; i.e., customers using the wired networks are being overcharged to fund the business.
- There is no evidence we need for high-speed services, based on current standards.
AT&T is double-talking here as it just announced 2–5 Gig speeds…
“…at present there is no compelling evidence that those expenditures are justified over the service quality of a 50/10 or 100/20 Mbps product.”
- We don’t really need fiber optics — It should not be fiber everywhere.
“Fiber is the most “future-proof” approach, but it is commonly accepted that it is not practical to assume fiber can or should serve every household in rural America.
“There would be significant additional cost to deploy fiber to virtually every home and small business in the country.”
“Let them eat cake”, is a line that has been attributed to Marie Antoinette, before her untimely demise as Queen of France. While the populace was starving, the aristocracy of France had lavish balls and were oblivious to the revolution on the way.
The comments on the site show a serious underlying anger at how AT&T has handled telecom and the statements made show just how out of touch the company’s management really is to what the population thinks.